Murabaha [font, alqalamreg, (مرابحہ)

It is an Islamic financing tool for individuals and companies who fall short in cash flows and want to expand their trading activities. In this agreement, the lender (the investor) invests in the product which is required by the buyer and sells it to the buyer with a declared rate of profit. The buyer takes the goods, but pays the amount on a later date or in installments as per their pre-agreed conditions.